THIS is the time of year when nations, no less than individuals,
should take stock of accomplishments and failures and set their
sights to the future. What most troubles Americans today is the
sorry state of the United States economy. In an increasingly
interdependent world, that is reason enough to be concerned about
how we manage our global economic affairs.
Here are 10 ways that we can do better in 1992.
1. Stop blaming others for our problems. Japan did not cause our
recession. We should press Japan to open its markets, but mainly we
have to get tough with ourselves.
2. Even better, stop thinking in terms of "them and us." Smart
strategies of bargaining and cooperation - not confrontation - work
best in promoting economic interests. A prosperous Europe and Japan
mean more markets for US products and more jobs for American
3. Stop dithering and get on with basic economic reforms.
Shrinking our budget deficit may be difficult, but eventually it is
the only way to shrink our trade deficit. We also need to spend
more to increase our international competitiveness - by rebuilding
our schools, rehabilitating our deteriorated physical
infrastructure, and improving our health-care delivery. That means
more taxes, not less.
4. Don't get hung up on ideology. The free market is usually the
most efficient way to allocate resources and produce goods, but
markets are not good at educating the young, caring for the old,
building roads, keeping the environment clean, or preventing S&L
disasters. Those tasks must fall to governments.
5. Recognize that economics is now the driving force of US
foreign policy. Economic strength has become more important than
military force. The value of American exports counts more than the
throw-weight of our missiles. In the post-cold-war era, the
Departments of Commerce and Treasury should often have more to say
about international negotiations than State and Defense.
6. Push hard for agreements to liberalize trade. Next year will
be decisive for two crucial sets of negotiations: the Uruguay Round
of the General Agreement on Trade and Tariffs (GATT), which governs
most global commerce, and the North American free-trade agreement
(NAFTA), which will ease trade barriers among Canada, Mexico, and
the US. Failure to satisfactorily conclude the GATT talks could set
the world on a downward spiral of market closing and trade
conflicts that would cost every country dearly. …